Due to TWC's always cutting-edge and modern approach to cable (), I must use an optical cable to connect to my SC-BTT195 in order to utilize all of my surround sound. TWC does not support Dolby Digital over HDMI (only Dolby AC3 over optical), and when I use HDMI from the cable box, it sounds awful as almost all of the sound comes through my center channel speaker. No bass at all, rear and side speakers are all but useless.

I figured connecting through an optical cable would not be a problem, as when I would want to switch to my 360 or use Pandora on my TV (LG LM7600 - ARC compatible), I could just manually switch to ARC mode. Right?

Wrong. ARC only seems to work unless I have the "TV Audio Input" setting to ARC. There isn't anything in the manual that states the "TV Audio Input" setting does anything other than set a default audio input for when I turn on the TV or switch inputs. Manually switching to ARC when "TV Audio Input" is set to anything other than ARC doesn't work. I've got an HDMI 1.4 cable plugged into the ARC-labeled port on my TV, so I do not understand why it will not work. If ARC is not usable in this case, then why do they allow it as a selectable input when ARC isn't set as the default?

Panasonic has been absolutely non-helpful with the issue, and they don't seem to understand it whatsoever from the few responses I could get them elicit. All they've told me is, "We suggest using an optical cable to connect from your TV." Well, that would work fine and dandy if TWC cable boxes supported Dolby Digital over HDMI... I have since put in a suggestion to them to add this in their next generation of cable boxes. Fat chance that'll get anywhere, but it doesn't hurt anything but my own time.

I'm going to take a stab at making some suggestions. First off, if TWC wasn't outputting Dolby 5.1 over HDMI I think there'd be a LOT of posts about that. I've never read a single one. I think the issue is your TV probably does not output 5.1 from connected devices. Most HDTVs don't. They downmix to 2-ch stereo. You could check the owner's thread for your TV in the display section here on AVS, or contact LG support to confirm this. If that is the case, then your only option for getting 5.1 from cable is using an optical cable as you are doing. BTW, according to Dolby's website, DD5.1 and AC3 are the same thing.

The manual for your HTiB is downright confusing regarding the setting for ARC or digital for the TV input. Looks like there are several combinations of things that can be set. I'd try them all, and I'd also take another try at Panny CS simply asking why you cannot change the input.

If you do have to go the optical switch route, there are relatively inexpensive ones. Here's a link to one and I'm sure there are others.

Possumgirl is almost certainly correct that the problem is not the cable box. Most TVs do not pass DD 5.1 from attached devices. ARC does not add any functionality in this area. It's just a way to save one cable between a TV and a receiver.

So, if you want discrete 5.1, you have to attach the source devices directly to the receiver, not to the TV. Unfortunately, your HTIB has no HDMI inputs and only one optical. It's really not designed to function as a true hub.

I am unclear on the problem you are having with the receiver switching between the optical input and the ARC feed from the TV. What happens when you are using the optical input and then change to the HDMI source from the TV? And what happens switching from HDMI to optical?

Over HDMI, I was noticing I was not getting any sound from my rear speakers, and that almost all of it was exclusively coming from my center channel. There is a setting on the cable box itself, with 3 output settings: "HDMI, PCM, and AC3." If I set it to AC3, I will get surround sound with much improved sound quality, but it no longer outputs sound through HDMI. As was said, it's likely because this is because the TV is not passing AC3 through HDMI, assuming AC3 is being sent over HDMI.

Now the strange thing is, TWC just recently changed their FAQs, stating that a digital coax input is for surround sound, when about 3 weeks ago, their FAQ online said it was only through optical. Hmmm...

I am going to research into all of this further, but if that's the case, all of this can be solved if all I'll need to do is just connect my TV to my receiver using a TosLink cable after entering the service menu.

In terms of the problem I am having, there is a certain setting on the HTIB menu called "TV Audio Input" that must be set to an input. If I set it to ARC, I am able to hear audio between all inputs. If I switch "TV Audio Input" to any other input, I lose all sound from ARC.

Personally, I'd stay out of the SM. It is way TOO EASY to screw up your tv. What works for one person may not work for you for lots of reasons so beware. ARC is nice but all it really does is save you a cable. I'd just use the optical cable from your tv to your receiver for 5.1.

Optical from the TV won't give him 5.1 from external sources either. But I agree, there are other ways that don't involve the risks of poking around in the service menus.

I still don't understand the OP's problem with switching between the optical input and an audio source using ARC. The manual shows three options for audio from external devices - AUX, ARC, and Digital In. It looks like you can choose the one you want to hear using the AV/INPUT button on the remote or my going to the HOME screen and selecting one of the three inputs from the EXT IN option. Regardless, only one input will be active at a time.